Recap of Jim Cramer's comments on Stop Trading! Thursday September 18.
The damage being done to stocks through short selling, where Wall Street’s most legendary institutions are losing value at alarming rates, could be the work of financial terrorism. Cramer did say that, given the fact that the U.S. is in a “financial nationally emergency,” the “financial terrorism thing, to me, has to be put on the table because the regular short-sellers are not doing this." Cramer’s been talking to the short sellers he knows, and that’s the theory they’ve been putting forward. It's not his idea, he said, but people are saying that financial terrorism could be responsible for the decline in stocks such as Goldman Sachs and Morgan Stanley, which Cramer says should be doing fine otherwise. "Goldman has no home equity loans and car loans. Goldman does not have exposure to the parts of the economy that are bad," he said. "No one's listening to me that I think Goldman is fine." In the U.S., though, the Securities and Exchange Commission should bring back the uptick rule, Cramer said. That rule requires a stock to tick up in price before it can be sold short. Stocks such as Wells Fargo and U.S. Bancorp are doing fine. "We have so much love now for the deposit banks," Cramer said. "Wells Fargo could do whatever it wants." As for a ban on short-selling, Cramer was adamant that that was not the right move unless the threat of financial terrorism is real. "To ban short-selling is wrong," he said. "You can't ban the stuff. Just bring back the old rules. They worked for a long time."
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